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Technology Stocks : IBM -- Ignore unavailable to you. Want to Upgrade?

To: Robert Scott Diver who wrote (4107)	10/25/1998 9:42:00 AM
From: Skeeter Bug	Read Replies (1) \| Respond to of 8218

robert, i will let you in on a secret. good analysis and bubble markets (currently large liquid companies) are mutually exclusive. the bottom line is that you don't not make money (i wanted to phrase this so you could understand, mr double negative man ;-) by not going long in bubble markets for extended periods of time. btw, i miss your attacks on my writing style. did the hypocrisy light bulb go off all of a sudden, mr double negative man? ;-) that was a mean spirited attack from somebody so obviously ill equipped. actually, how well you are equipped isn't even an issue. that was just a plain mean spirited attack you made. the easy money is made in a bubble market for extended periods of time. when it bursts, though, all those who were geniuses a little while ago are now broke - no matter how much money they made. they tend to worry about the future a little bit too late. ;-) if you are a fund manager and don't not make money due to your inability to use downside strategies then you'd be in trouble. you can't hold lots of cash. most fund don't play the game to the downside. so, yes, they are forced to to play the bubble game. no good analysis can take place with any type of historical foundation. you need a "new era." all the bulls in a bubble market consider themselves absolute geniuses as their pes go from 10 or so to the mid 20s, mid 30s or mid 40s. some even expect the pe to go to 50 with no growth. or, maybe negative growth. then what? 80? maybe 160? think how many utter geniuses there were when the nikkei was 39k. ;-) problem is that if you were holding nikkei fluff at 39k you probably weren't smart enough to sell anywhere near that level. needless to say, they are much lower 10 years later. 66% lower. but, that can't happen here. why? we're special. problem is, so were the japanese at nikkei 39k. you are always special in a bubble market. then there are some bulls who are so not insensitive that they use ad hominem attacks (even if they don't know what it is ;-) against the intelligence of those who disagree with the risk/reward trade off of their particular stock. they take it personal. it is all risk vs reward. at all time high valuations relative, to eps growth, it is my opinion that the risk is higher than the reward. name a time where ibm traded at 23 times earnings with a stable growth rate of about 7%. now, in bubble environments, can stocks go from nose bleed areas to the stratosphere? absolutely. i think it is a very real possibility that ibm goes higher. they may even be able to keep their whopping 7% growth rate (you ibm bulls are very easily impressed ;-) even if we have a minor recession. this is due to its y2k business. we merely disagree on the risk reward of a large company growing at 7%, while using every trick in the book to generate said eps, that trades at 23 times massaged earnings. doesn't make you a genius and myself a dolt. nor the other way around. that view is just too not insensitive. ;-) don't not forget ;-) who attacked who here and try to play the victim now that you got busted. pleeeeeeease... at least take a little responsibility... but, hey. at least the focus is now off me and back to ibm. sort of ;-) the one idea that you have expressed, other than personal attacks, is that if everyone is buying ibm then it must be a good company at a good value. how long have you been investing? that, imho, is a very naive way to view the market. people bought asnd at $80... before it went to the low $20s. people bought mu at $95 before it went to a low of $17 or so. people bought ktel at nose bleed levels. ltc went bust and they had a self proclaimed master of the universe. cube was $50 before it went to the teens. in fact, when i bought puts on cmb about 3-4 months ago it was pushing $70. topped out at $75. a couple weeks ago it traded at $36. surely the big boys who sold me those puts were smart. smart enough to put 1000% return in my pocket :-) if that is smart then we need more intelligence in the markets. :-) develop you own method of valuation that makes sense. incorporate that into a low risk model of playing an irrational market. if you think the market is rational, or even good at valuing stocks, then, imho, you might want to consider some professional help. the market is an emotional mess. the trick is to profit from it. know what YOU do and don't risk your money based on the hope that others are bright and know what THEY are doing. btw, have you heard of statistics? probability distributions? would the computer that randomly assembled characters that resulted in the equation e=mc squared have a claim to superior intelligence over other computers? do you understand the analogy? luck is involved in investing, too. somebody who threw a dart and hit msft in the mid 1980s is killing just about everyone's portfolio right now. don't confuse a good stock pick with intelligence. just b/c i made 1000% on my cmb puts in less than 3 months doesn't mean i 1. deserved it or that i was wasn't just lucky (all those smart dolts had to run it up in the first place and 2. all those smart guys had to figure out that there was a massive banking crises before expiration). i was lucky to a large degree. the ninnies figured out the error of their ways and paid me the penalty ;-) the game is to put yourself in a position where you have a high probability of getting lucky. it doesn't always happen. the market is dynamic so you don't know what will happen from day to day. incredible luck one day can be replaced by real bad luck the next. you never know. i've been dead right and not done well b/c the market disagreed for extended periods of time. it doesn't matter that they were wrong. they have more money. they eventually caught on so i didn't due to badly but they are slowwwwwwwwwwwww sometimes. btw, did you find out what ad hominem means yet? if not, would you like to know?